# Raiders of Wall Street: an LBO you can lose your shirt on
Source: https://financialmodellingpodcast.com/blog/raiders-of-wall-street-lbo-game
Published: 2026-10-31
Author: Matthew Bernath, CFA
Topics: Financial Modelling, M&A
Play Raiders of Wall Street, a free LBO game set in 1984. Eight deals explore EBITDA multiples, leverage, bankruptcy risk and IRR versus money multiples.
Most people learn leveraged buyouts from a model template and a fair amount of nodding. I learnt about debt at RMB, where leverage did things to returns that the spreadsheet had politely flagged somewhere around cell AF212.

So I built a game. Raiders of Wall Street, at [leveraged.site](https://leveraged.site/), drops you into 1984 with a reputation score and eight deals to make or wreck a career. You can lose. Plenty of people do, me included, and I wrote the rules.

![](/__l5e/assets-v1/3e9a208a-63e1-482e-9020-19002c7cc719/raiders-of-wall-street-start.png)

_Raiders of Wall Street: the starting ranks, with Vice President selected._

## How a round works

Each round you get three acquisition targets. Pick one, negotiate the purchase price, then set the equity and debt split and choose a shorter or longer hold. While you own the business, events land on your desk: a union dispute, a refinancing window, an operational mess, a compliance problem. Each one asks you to choose, and each choice moves cash, reputation or both. Then you exit, at whatever multiple the market is paying that quarter.

You pick a starting rank. Associate gives you 70 reputation and forgiving leverage limits. Vice President is the standard 1984 experience at 50. Managing Director starts you on 30, throws extra events at you and tightens the bankruptcy threshold, which is a fair description of most MDs I've met.

## One deal, start to finish

Here's a deal from a recent run. It's 1984 and the market is bearish. The ticker has Volcker warning that speculative excess must be wrung out of the system, and the deal flow screen is marking exit multiples down by 1.0x.

Three targets were on offer. An auto parts company at 7x, pitched on the real estate hiding in its balance sheet. A paper and packaging business at 4x with a layer of middle management waiting to be cut. And Federal Holdings, an oil and gas company with $57m of EBITDA at 6x, so $342m, sold to me as a geographic monopoly on a dying product line. I took the monopoly.

Then I got greedy at the negotiating table. Negotiating gives you a 55% chance of shaving 0.5x to 1.5x off the multiple, a 30% chance the seller walks and a 15% chance they raise the price. I hit the 15%. The seller's bankers read my opening as weakness and came back at 6.5x, so I paid $370.5m for a business I could have had for $342m by keeping quiet. That's $28.5m for the privilege of feeling clever, a lesson most associates learn with someone else's money.

I funded it with 25% equity, $92.6m, and $277.9m of debt, which is 4.9x EBITDA. The structure screen called that safe territory and projected a 31.6% IRR before events. I chose the two to three year hold, which means three events rather than more.

The first event was a $15m underfunded pension, with the Teamsters and the PBGC both watching. Top it up and lose $15m of cash, or spin it into a NewCo for 20 points of reputation and a 20% chance of bankruptcy. A one in five chance of losing $92.6m of equity is about $18.5m of expected loss before you count the reputation hit, so on paper the $15m cheque is the cheaper option. It doesn't feel cheaper when you're writing it.

The exit came in at $398.3m. Debt was still $277.9m, so equity came out at $120.4m against $92.6m in: a $27.8m gain and a 30.0% realised IRR. My 20% carry was $5.6m.

![](/__l5e/assets-v1/7c4c01ec-875a-4512-a3b0-ab6cd71ac548/raiders-of-wall-street-exit.png)

_The final P&L statement for the Federal Holdings deal. Figures and realised IRR are as reported by the game._

Federal Holdings: results shown in the gameMetricResult

Exit enterprise value$398.3m

Entry equity$92.6m

Exit equity$120.4m

Net profit$27.8m

Realised IRR reported by the game30.0%

Carry at 20%$5.6m

Now imagine the bear market had done its worst. A 1.0x lower exit multiple on $57m of EBITDA takes $57m off enterprise value. Against $92.6m of equity that's 62% of the cheque gone, and the debt doesn't shrink to share the pain. At 4.9x leverage, small moves in the multiple turn into large moves in your equity. Push the debt further and the game will bankrupt the company, taking your equity and a chunk of your reputation with it.

## The price you pay on the way in

Private equity people like to say you make your money when you buy. The game takes that literally. Market conditions shift exit valuations, so the multiple you paid and the multiple you sell at can drift apart in either direction.

Reputation changes the entry price too. Above 70, new targets cost half a turn of EBITDA less. Below 30, they cost half a turn more. On a business with $10m of EBITDA that's $5m of purchase price either way, earned or lost through how you handled the last few event choices. The deal flow screen shows the current effect, so you can see what that cost cutting decision three deals ago is still costing you.

I like this mechanic because it prices something real models leave out. Lenders and sellers both charge for your track record, and nobody gives it a row in the model.

## IRR likes a quick exit

The hold period choice is where IRR starts misbehaving. A 2x return over three years is roughly a 26% IRR. A 2.5x return over five years is roughly 20%. The longer deal makes more money and looks worse on the headline metric.

In the game you choose a shorter or longer run on every deal. Go short and you lock in a strong IRR before the market turns. Go long and the business has time to grow, while the market has time to ruin your exit. Which one wins depends on the market you sell into, and nobody tells you that in advance.

## What you get between and after deals

Event choices come with analyst notes on the finance behind them, such as why a refinancing changes your equity value. Between deals you can hire advisors and trade public stocks, which gives you more options and more ways to embarrass yourself.

A career ends with a scorecard and your deal history, with the lessons it thinks you should have learnt. Saves sit against your email address, so you can pick a career back up whenever Excel lets you go.

It's a game, so the edges are smoothed. A real buyout model has covenant tests and a management team with opinions. If you've built an LBO model and wondered whether you understood it or just filled it in, eight deals will tell you quickly.

The career high on the start screen currently sits at $23.0m of carry. Start as a Vice President, and if you go bust by deal three, drop to Associate. Nobody's checking.

Play Raiders of Wall Street at [leveraged.site](https://leveraged.site/).